3 Surprising Facts about Legal Marijuana in Colorado

Welcome to Colorado highway sign with marijuana leaf

Legal marijuana is a growing trend across the U.S.—whether it refers to legal medical marijuana, or legal recreational marijuana. Already it is a multibillion dollar business that is only expected to continue in its growth. Colorado was the birthplace of this shift in perspective occurring all over the U.S. about marijuana and its uses and was the first state to legalize the substance.

Here, marijuana has been legalized for recreational use by adults since 2012, with the first sale being made in 2014. While it might all seem straightforward from there, it’s not quite. There are many laws still hanging around this substance that make its purchase and consumption fraught with wrong turns that could easily land a marijuana user in big trouble. Let’s take a look at 3 surprising facts about legal marijuana in Colorado.

1.Street consumption

In Colorado, public consumption of marijuana is illegal. This means you cannot smoke or eat the product in public. Earlier this year, a bill was proposed that would allow for tasting rooms within dispensaries that would enable customers to consume their product in a relaxed and social cafe-like setting. However, this bill was quickly vetoed by Governor John Hickenlooper. So, while buying marijuana is legal within Colorado, the consumption of it must be within your own home or property.

2. Marijuana Taxes

Since legalization, marijuana business owners have complained about the incredibly high tax burden placed on them—and rightly so. Those working in the marijuana business lose around 70-80% of their sales income to federal taxes.

This, by far, offsets the idea of the marijuana gold rush that has been the perception of most people on the marijuana trade in Colorado so far. So you may be wondering: why? Why is this tax burden is so high?

The tax burden placed on marijuana retailers all comes down to section 280E of the Internal Revenue Service tax code which states that a business cannot write off the normal business expenses like payroll, rent, or utilities on their federal tax return if their business involves the sale of an illegal drug (even if that drug is legal in their state). Therefore, marijuana dispensaries are operating their businesses without being able to claim their business running costs.

3. No advertising

While most users of marijuana know to look for the green cross that hangs over the dispensary to indicate their marijuana sales, there is no other form of advertising allowed in the state of Colorado. Why? Colorado’s Mariana advertising laws are strict and clearly prohibit any advertisements of marijuana on television, the radio, the internet, or at any sponsored event.

So while Colorado was the first U.S. state to legalize cannabis, and certainly paved the future of legalized marijuana across the U.S., many of the laws within the state that surround cannabis make it difficult for the revolution to go much further. It’s too early to know if the legalization of marijuana will be a boon for the state’s economy, or a nightmare instead. Only time will tell on the future of an industry as new and controversial as this.

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About the Author: Alex Fisher